Sabic to axe jobs and shut down plants in Europe

Citing structural changes in Europe and slower growth, Riyadh-headquartered petrochemicals supplier Sabic plans to cut about 1,050 jobs and close some plants in Europe.

The firm says it has started talks with trade unions on the plan, with the job cuts to take place across Europe, a third of which will be contracting staff and two-thirds of whom will be Sabic employees.

The company faces stiffer competition from a revived US chemical and plastics industry that’s benefiting from shale gas supplies. Shale gas has helped transform the US economic outlook by luring gas-intensive industries like petrochemicals, while Asia shows greater demand growth prospects.

As well, Sabic says that lower consumer spending on houses, cars, appliances and less investment on infrastructure in Europe was cutting demand and squeezing margins for its plastic products.

The company, which made a net profit of around US$6.59 billion in 2012 and has 40,000 employees spread across 40 countries, did not identify which European businesses it would shut.


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